Many sales managers have been grappling with whether to make midyear changes to their compensation plans to reflect the realities of today’s soft market. The answer to that question is a resounding maybe, says J. Mark Davis, managing principal at Valitus Group (www.valitusgroup.com). To help you decide whether a change is warranted, first confirm that your team’s underperformance is a function of outside market forces and not a reflection of low productivity, says Davis. Next, make sure your numbers are far enough off to warrant a midyear change – shockingly few reps performing at quota, for instance, or too many (25 percent or more) reps below threshold or no one achieving excellence.
If you’re nodding your head because this all sounds familiar, a midyear plan adjustment is likely appropriate. But don’t go making sweeping changes; instead, make one or more of the adjustments below. These types of incremental changes, says Davis, enable you to keep the “overall framework of your sales compensation plan intact” while still adjusting it to the realities of the market.